exv99w2

Exhibit 99.2

HERSHA HOSPITALITY TRUST

Pro Forma Consolidated Statement of Operations
For the year ended December 31, 2004
(Unaudited, Dollar Amounts in Thousands Except per Share Data)

The accompanying unaudited Pro Forma Consolidated Statement of Operations for the year ended December 31, 2004 is presented as if the acquisition of the McIntosh Portfolio had been consummated and leased as of January 1, 2004.

This pro forma consolidated statement should be read in conjunction with the Hersha and McIntosh Portfolio historical financial statements and notes thereto. In management’s opinion, adjustments necessary to reflect the effects of the acquisitions have been made based on management’s best estimates.

The following unaudited Pro Forma Consolidated Statement of Operations is not necessarily indicative of what actual results of Hersha would have been assuming such acquisitions had been completed as of January 1, 2005, nor is it indicative of the results of operations for future periods

HERSHA HOSPITALITY TRUST

Pro Forma Consolidated Statement of Operations
For the year ended December 31, 2004
(Unaudited, Dollar Amounts in Thousands Except per Share Data)


	(A)			(B)
	Hersha Hospitality
	Trust			McIntosh Portfolio			Combined			Adjustments					Pro Forma
Revenue:
Percentage Lease Revenues - HHMLP	$	1,192		$	—		$	1,192		$	—				$	1,192
Hotel Operating Revenues		49,370			8,457			57,827			—					57,827

Total Revenue		50,562			8,457			59,019			—					59,019
Operating Expenses:
Hotel Operating Expenses		31,557			6,505			38,062			—					38,062
Land Lease		779			—			779			—					779
Real Estate and Personal Property Taxes and Property Insurance		3,264			509			3,773			—					3,773
General and Administrative		3,200			460			3,660			—					3,660
Unrecognized Gain on Derivative		62			—			62			—					62
Depreciation and Amortization		7,194			1,664			8,858			(446	)	(C	)		8,412

Total Operating Expenses		46,056			9,138			55,194			(446	)				54,748


Operating Income		4,506			(681	)		3,825			446					4,271

Interest Income		241			—			241			—					241
Interest Income - Secured Loans Related Party		1,498			—			1,498			—					1,498
Interest Income - Secured Loans		693			—			693			—					693
Other Revenue		176			—			176			—					176
Interest Expense		(6,130	)		(1,840	)		(7,970	)		(479	)	(D	)		(8,449	)

Income (Loss) from continuing operations before income (loss) from joint venture investments, distributions to preferred unit holders and minority interests		984			(2,521	)		(1,537	)		(33	)				(1,570	)
Income from Unconsolidated Joint Venture Investments		481			—			481			—					481

Income (Loss) from continuing operations before distributions to preferred unit holders and minority interests		1,465			(2,521	)		(1,056	)		(33	)				(1,089	)
Distributions to Preferred Unitholders		(499	)		—			(499	)		—					(499	)
(Income) Loss Allocated to Minority Interest in Continuing Operations		(126	)		—			(126	)		396		(E	)		270


Income (Loss) from Continuing Operations	$	840		$	(2,521	)	$	(1,681	)	$	363				$	(1,318	)


Earnings Per Share from Continuing Operations
Basic	$	0.05													$	(0.08	)

Diluted	$	0.05													$	(0.08	)


Weighted Average Common Shares Outstanding
Basic		16,391,805														16,391,805
Diluted		19,401,636														19,401,636

See notes to pro forma consolidated statement of operations

HERSHA HOSPITALITY TRUST

Notes and Management’s Assumptions to the
Pro Forma Consolidated Statement of Operations
For the Year Ended December 31, 2004
(Unaudited, Dollar Amounts in Thousands Except per Share Data)

(A)

Represents Hersha’s audited Consolidated Statement of Operations for the year ended December 31, 2004 as filed on Form 10-K, excluding discontinued operations.

(B) Represents the historical statement of operations for the McIntosh Portfolio for the year ended December 31, 2004 included in the audited financial statements of McIntosh Motor Inns Portfolio.

(C) Represents the adjustment to reflect the estimated depreciation on property of the McIntosh Portfolio after the allocation of purchase price, net of the amounts recorded for depreciation in the historical statement of operations for the McIntosh Portfolio. Depreciation is computed using the straight-line method and is based upon the estimated useful life of the asset. The pro forma adjustment is as follows:


	Purchase Price				Depreciation
	Allocated		Life		Expense
Land	$	8,171		N/A		N/A
Building		39,699		40		993
Furniture & Fixtures		1,572		7		225

Total					$	1,218
Less: McIntosh Portfolio historical depreciation						(1,664	)


Pro Forma Adjustment					$	(446	)

(D) Represents the adjustment to reflect the estimated annual interest expense for the McIntosh Portfolio on proceeds from the mortgage payable and borrowings under the line of credit facility to finance the acquisitions, net of interest expense included in the historical statement of operations for the McIntosh Portfolio. Included in the adjustment is amortization of deferred loan costs of $489 over the three year term of the loan. The pro forma adjustment is as follows:


			Weighted			Estimated
			Average			Interest
	Principal		Interest Rate			Expense
Mortgages Payable	$	34,230		4.47	%		1,530
Line of Credit		14,562		4.30	%		626

Total						$	2,156
Amortization of deferred loan costs							163
Less: McIntosh Portfolio historical interest expense							(1,840	)


Pro Forma Adjustment						$	479

(E) Represents minority interest allocable to holders of units of limited partnership interest in our operating partnership. The cumulative minority interest effect of the McIntosh Portfolio is calculated by using the weighted average minority interest percentage of 15.5% for the year ended December 31, 2004, as follows:


Historical McIntosh Portfolio Net Loss	$	2,521
Depreciation and Amortization Pro Forma Adjustment		(446	)
Interest Expense Pro Forma Adjustment		479

Total	$	2,554
Minority Interest Percentage		15.5	%


Pro Forma Minority Interest Adjustment	$	396

Unaudited Pro Forma Consolidated Financial Information

HERSHA HOSPITALITY TRUST

Pro Forma Consolidated Balance Sheet
As of March 31, 2005
(Unaudited, Dollar Amounts in Thousands Except per Share Data)

The accompanying unaudited Pro Forma Consolidated Balance Sheet as of March 31, 2005 is presented as if the acquisition of the McIntosh Portfolio occurred on March 31, 2005.

This pro forma consolidated statement should be read in conjunction with the Hersha and McIntosh Portfolio historical financial statements and notes thereto. In management’s opinion, adjustments necessary to reflect the effects of the acquisition of the McIntosh Portfolio have been made based on management’s best estimates.

The following unaudited Pro Forma Consolidated Balance Sheet is not necessarily indicative of what the actual financial position of Hersha would have been assuming such acquisitions had been completed as of March 31, 2005, nor is it indicative of future financial positions of Hersha.

HERSHA HOSPITALITY TRUST

Pro Forma Consolidated Balance Sheet
As of March 31, 2005
(Unaudited, Dollar Amounts in Thousands Except per Share Data)


	(A)		(B)
	Hersha		McIntosh
	Hospitality Trust		Portfolio			Combined
Assets:
Investment in Hotel Properties, net	$	171,990	$	49,442		$	221,432
Due from Related Party		27,849		—			27,849
Other Assets (includes hotel assets held for sale of $18,806)		56,428		(650	)		55,778

Total Assets	$	256,267	$	48,792		$	305,059


Liabilities and Shareholders’ Equity:
Mortgages Payable	$	97,395	$	34,230		$	131,625
Other Liabilities (includes debt related to hotel assets held for sale of $12,952)		25,359		14,562			39,921

Total Liabilities		122,754		48,792			171,546

Minority Interest:		18,174		—			18,174
Shareholders’ Equity:		115,339		—			115,339

Total Liabilities and Shareholders’ Equity	$	256,267	$	48,792		$	305,059

See notes to pro forma consolidated balance sheet.

HERSHA HOSPITALITY TRUST

Notes and Management’s Assumptions to the
Pro Forma Consolidated Balance Sheet
As of March 31, 2005
(Unaudited, Dollar Amounts in Thousands Except per Share Data)

(A)		Represents the unaudited Consolidated Balance Sheet of Hersha as of March 31, 2005 as filed on Form 10-Q.

(B)		Represents the purchase of the McIntosh Portfolio as if it had occurred on March 31, 2005 for $48,900 plus transaction expenses. The source of funding for the acquisition was a mortgage payable of $34,230; borrowings under line of credit of $14,562 and cash of $3,001.

		The following are based on a preliminary allocation of purchase price and cash paid in the acquisition:


Land	$	8,171
Building		39,699
Furniture and Fixtures		1,572


Investment in Hotel Properties	$	49,442


Deferred Costs, net	$	489
Escrow Deposits		1,576
Other Assets		286
Cash and Cash Equivalents		(3,001	)


Other Assets	$	(650	)

HERSHA HOSPITALITY TRUST

Pro Forma Consolidated Statement of Operations
For the three months ended March 31, 2005
(Unaudited, Dollar Amounts in Thousands Except per Share Data)

The accompanying unaudited Pro Forma Consolidated Statement of Operations for the three months ended March 31, 2005 is presented as if the acquisition of the McIntosh Portfolio had been consummated and leased as of January 1, 2005.

HERSHA HOSPITALITY TRUST

Pro Forma Consolidated Statement of Operations
For the three months ended March 31, 2005
(Unaudited, Dollar Amounts in Thousands Except per Share Data)


	(A)			(B)
	Hersha			Machintosh
	Hospitality Trust			Portfolio			Combined			Adjustments			Pro Forma
Revenue:
Percentage Lease Revenues — HHMLP	$	—		$	—		$	—		$	—		$	—
Hotel Operating Revenues		12,800			2,267			15,067			—			15,067

Total Revenue		12,800			2,267			15,067			—			15,067
Operating Expenses:
Hotel Operating Expenses		9,278			1,510			10,788			—			10,788
Land Lease		183			—			183			—			183
Real Estate and Personal Property Taxes and Property Insurance		883			136			1,019			—			1,019
General and Administrative		990			95			1,085			—			1,085
Unrecognized Gain on Derivative		(4	)		—			(4	)		—			(4	)
Depreciation and Amortization		1,963			415			2,378			(111	) (C)		2,267

Total Operating Expenses		13,293			2,156			15,449			(111	)		15,338


Operating Loss		(493	)		111			(382	)		111			(271	)

Interest Income		37			—			37			—			37
Interest Income — Secured Loans Related Party		1,000			—			1,000			—			1,000
Interest Income — Secured Loans		—			—			—			—			—
Other Revenue		27			—			27			—			27
Interest Expense		(1,875	)		(505	)		(2,380	)		(223	) (D)		(2,603	)

Loss from continuing operations before income (loss) from joint venture investments, distributions to preferred unit holders and minority interests		(1,304	)		(394	)		(1,698	)		(112	)		(1,810	)
Income from Unconsolidated Joint Venture Investments		49			—			49			—			49

Loss from continuing operations before distributions to preferred unit holders and minority interests		(1,255	)		(394	)		(1,649	)		(112	)		(1,761	)
Distributions to Preferred Unitholders		—			—			—			—			—
Loss Allocated to Minority Interest in Continuing Operations		261			—			261			62	(E)		323


Income from Continuing Operations	$	(994	)	$	(394	)	$	(1,388	)	$	(50	)	$	(1,438	)


Earnings Per Share from Continuing Operations
Basic	$	(0.05	)										$	(0.07	)

Diluted	$	(0.05	)										$	(0.08	)


Weighted Average Common Shares Outstanding
Basic		20,291,234												20,291,234
Diluted		23,133,671												23,133,671

See notes to pro forma consolidated statement of operations

HERSHA HOSPITALITY TRUST

Notes and Management’s Assumptions to the
Pro Forma Consolidated Statement of Operations
For the Three Months Ended March 31, 2005
(Unaudited, Dollar Amounts in Thousands Except per Share Data)

(A)		Represents Hersha’s Consolidated Statement of Operations for the three months ended March 31, 2005 as filed on Form 10-Q, excluding discontinued operations.

(B)		Represents the historical statement of operations for the McIntosh Portfolio for the three months ended March 31, 2005, included in the financial statements of McIntosh Motor Inns Portfolio.

(C)		Represents the adjustment to reflect the estimated depreciation on property of the McIntosh Portfolioafter the allocation of purchase price, net of the amounts for depreciation recorded in the historical statement of operations for the McIntosh Portfolio. Depreciation is computed using the straight-line method and is based upon the estimated useful life of the asset. The pro forma adjustment is as follows:


	Purchase Price			Depreciation
	Allocated		Life	Expense
Land	$	8,171	N/A		N/A
Building		39,699	40		248
Furniture & Fixtures		1,572	7		56

Total				$	304
Less: McIntosh Portfolio historical depreciation					(415	)


Pro Forma Adjustment				$	(111	)

(D) Represents the adjustment to reflect the estimated three month interest expense for the McIntosh Portfolio on proceeds from the mortgage payable and borrowings under the line of credit facility to finance the acquisitions, net of interest expense included in the historical statement of operations for the McIntosh Portfolio. Included in the adjustment is amortization of deferred loan costs of $489 over the three year term of the loan. The pro forma adjustment is as follows:


			Weighted			Estimated
			Average			Interest
	Principal		Interest Rate			Expense
Mortgages Payable	$	34,230		5.59	%		478
Line of Credit		14,562		5.75	%		209

Total						$	687
Amortization of deferred loan costs							41
Less: McIntosh Portfolio historical interest expense							(505	)


Pro Forma Adjustment						$	223

The interest rate on the mortgage payable is LIBOR plus 3.0%. On July 1, 2005, Hersha entered into an interest rate cap, with an unaffiliated financial institution, which will effectively cap the interest rate on the $34,230 mortgage payable at 8.0%. This instrument has no impact on these pro forma financial statements.

(E) Represents minority interest allocable to holders of units of limited partnership interest in our operating partnership. The cumulative minority interest effect of the McIntosh Portfolio is calculated by using the weighted average minority interest percentage of 12.3% for the three months ended March 31, 2005, as follows:


Historical McIntosh Portfolio Net Loss	$	394
Depreciation Pro Forma Adjustment		(111	)
Interest Expense Pro Forma Adjustment		223

Total	$	506
Minority Interest Percentage		12.3	%


Pro Forma Minority Interest Adjustments	$	62

		The interest rate on the mortgage payable is LIBOR plus 3.0%. On July 1, 2005, Hersha entered into an interest rate cap, with an unaffiliated financial institution, which will effectively cap the interest rate on the $34,230 mortgage payable at 8.0%. This instrument has no impact on these pro forma financial statements.

(E)		Represents minority interest allocable to holders of units of limited partnership interest in our operating partnership. The cumulative minority interest effect of the McIntosh Portfolio is calculated by using the weighted average minority interest percentage of 12.3% for the three months ended March 31, 2005, as follows: